National Credit Union Administration to repay Treasury in full
ALEXANDRIA, VA (October 18, 2016) — By Oct. 31, the National Credit Union Administration plans to fully repay the $1 billion outstanding balance on the agency’s borrowing line with the U.S. Treasury.
“This marks an historic moment for both NCUA and the entire credit union system,” NCUA Board Chairman Rick Metsger said. “The success of the corporate resolution program is a testament to the hard work and perseverance of our entire team, and I extend my deep personal gratitude to all of them for making this possible.”
When that payment is made, the Temporary Corporate Credit Union Stabilization Fund’s outstanding borrowings from the U.S. Treasury will be fully repaid. NCUA’s $6 billion borrowing line with Treasury remains available to satisfy future agency contingent funding needs, including obligations of the NCUA Guaranteed Notes Program.
While Treasury borrowings will be repaid, no funds will be available to provide federally insured credit unions with an immediate rebate of Stabilization Fund assessments. Additionally, no funds are available for any recoveries by investors with claims for depleted capital of the failed corporate credit unions. NCUA must first satisfy any outstanding senior obligations of the Stabilization Fund and corporate credit union asset management estates.
Possible rebates or recoveries are based on projections that can change over time. Projected values of the Stabilization Fund and the corporate credit union asset management estates may not be realized until 2021. Future changes in the economy or the performance of the legacy assets that secure the NCUA Guaranteed Notes could change their value.
NCUA will provide additional information in the near future related to the timing of potential rebates and capital recoveries.
About National Credit Union Administration (NCUA)
The NCUA is the independent federal agency created by the U.S. Congress to regulate, charter and supervise federal credit unions. With the backing of the full faith and credit of the United States, the NCUA operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of more than 135 million account holders in all federal credit unions and the overwhelming majority of state-chartered credit unions. The NCUA also protects consumers and educates the public on consumer protection and financial literacy issues.